B.Riley FBR Keeps Their Buy Rating on Select Energy Services Inc (WTTR)


In a report released yesterday, Tom Curran from B.Riley FBR maintained a Buy rating on Select Energy Services Inc (NYSE: WTTR), with a price target of $22. The company’s shares opened today at $13.73.

Curran said:

“In light of our energy team’s Permian bottlenecks work and WTTR’s call, we’re lowering our WTTR revenue/adjusted EBITDA for (1) 2018 from $1.674B/$285M to $1.59B/$266M, and (2) 2019 from $1.963B/$375M to $1.83B/$345M to factor in an expected temporary slowdown by WTTR’s smaller customers in the Permian, which accounted for 37% of 2Q18 revenues. On our new 2019 EBITDA, our unchanged target multiple of 7.0x reduces our price target from $24 to $22. At its present valuation, we believe the stock is vastly overweighting Permian negatives and underweighting-to-ignoring myriad positives, including WTTR’s margin and FCF trajectories and rising odds of winning a large, infrastructure award. Reiterate Buy on compelling risk-reward.”

According to TipRanks.com, Curran has 0 stars on 0-5 star ranking scale with an average return of -3.8% and a 43.9% success rate. Curran covers the Basic Materials sector, focusing on stocks such as Independence Contract Drilling, Diamond Offshore Drilling, and Eco-Stim Energy Solutions.

The word on The Street in general, suggests a Strong Buy analyst consensus rating for Select Energy Services Inc with a $21.20 average price target, a 54.4% upside from current levels. In a report released yesterday, Seaport Global also reiterated a Buy rating on the stock with a $27 price target.

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Select Energy Services Inc’s market cap is currently $1.06B and has a P/E ratio of 60.30. The company has a Price to Book ratio of 1.33.

Based on the recent corporate insider activity of 48 insiders, corporate insider sentiment is negative on the stock.

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Select Energy Services Inc. engages in the provision of water management and chemical solutions. It operates through the following business segments: Water Solutions, Oilfield Chemicals, and Wellsite Services.

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